Ingram Micro Logistics, a 3rd party logistics provider for high-tech manufacturers, handles some 14,000 orders daily with 99.92% accuracy thanks in part to the application of proven equipment and systems.

ne of the things that we like to say is that we no longer run warehouses. We operate distribution centers, or flow-through facilities,” says Chuck Lounsbury, senior vice president for Global EHT and CPG Industries for Ryder Logistics.

What is Lounsbury's rationale for this new definition of 3PLs? He says it's the fast-paced nature of the 3PL business today. “It’s unusual for us to hold a particular item longer than 30 days – and in fact normally it’s a much shorter timeframe than that. With seemingly every company out there trying to take inventory out of the channel, there is now extra pressure on the 3PLs to do it quickly and get it right the first time.”

Oh yeah, and add in the need for flexibility to boot. “From a materials handling perspective, we have to make sure that we have designed in the flexibility to handle a broad cross-section of product. Not only in terms of dimensional variability, but also in terms of order profile variability,” says Chris Sang, founder, chairman, and CEO of the 3PL iFulfillment.

But it doesn’t mean they always have an infinite budget with which to meet those goals. “We do lots of work with the 3PLs, and one of their major objectives is to limit the amount of capital investment that they put into their facilities,” says John Yacka, a systems designer with the consulting company Gross & Associates. “As a consequence, we’re seeing some very clever things being done with lower-cost designs.”

For example, Yacka says that he is seeing more mixing and matching of storage and staging systems – even within a single picking line. “The benefit to 3PLs is that by combining equipment in creative ways, they can achieve the best trade-off in terms of cost, flexibility, and throughput,” says Yacka. Similarly, different types of industrial trucks are brought into the mix to interface with these diverse storage systems.

"We no longer run warehouses, we operate distribution centers,"
Chuck Lounsbury, senior vice president, Ryder Logistics

When it comes to the economics of building new facilities, Lounsbury concurs with Yacka. “It’s not to say that we never put something like high-speed automation into our facilities – in fact we just installed a new highspeed conveyor system at one of our DCs – it’s just that we have to be sure that the payback is there. We don’t want to make the investment without the assurance that we are going to have that business for the long-haul.”

Increasingly, 3PLs – like everyone else these days – are looking for ways to get the most bang out of their buck. Often that means sticking with the traditional, proven technologies, including storage racks and systems, industrial lift trucks, dock equipment, reusable containers, and WMS software.

“They are not so much looking for the latest bells and whistles as they are really looking to build solid functionality into their systems – whether it be the warehouse layout or the equipment itself,” says Yacka. “They want to make sure that they can get the product out the door quickly, accurately, and efficiently first.”

“We look initially for off-theshelf technologies that will help us accomplish those goals,” explains Lounsbury. “Frequently, when it comes to software, where no one application exactly meets our requirements, we tailor it. But the less development we have to do with any new technology, the better for us.”

Software makers are responding to that need, with more addon modules and products targeted at particular industries – including 3PLs. Hardware and equipment suppliers are also introducing new products with functionality and flexibility in mind – many of which are featured here in this special report on world-class 3PLs.

We also feature layouts of five world-class 3PL facilities that have creatively combined materials handling equipment and systems to meet a host of operational goods, including:

• High throughput
• Picking efficiency
• Rapid order processing
• Efficient use of space
• Efficient processing of value- added services

The goal is simple: To provide you with ideas on how you can create a world-class facility of your own.